Lucid Group Secures Massive Funding with Dual Offerings
In a significant move to bolster its finances, Lucid Group has announced a dual-pronged approach to raise capital through a public offering and a private placement. This strategic maneuver is expected to generate a substantial influx of funds, totaling approximately $1.67 billion.
Public Offering Details
The underwritten public offering will see 262,446,931 shares of Lucid’s common stock being issued, with BofA Securities acting as the sole underwriter. The deal is anticipated to close on or around October 18, 2024, pending customary closing conditions.
Private Placement Agreement
In a separate agreement, Lucid’s majority stockholder, Ayar Third Investment Company, an affiliate of the Public Investment Fund, has agreed to purchase 374,717,927 shares of common stock in a private placement. This transaction is expected to close on October 31, 2024, contingent upon the successful completion of the public offering and customary closing conditions.
Ayar’s Ongoing Commitment
As a result of these purchases, Ayar is set to maintain its approximate 58.8% ownership stake in Lucid’s outstanding common stock. Furthermore, Ayar has committed to purchasing additional shares from Lucid in the event the underwriter exercises its option, ensuring its ownership percentage remains stable. An additional closing for this purchase would take place 10 business days after the underwriter’s option exercise.
Funding Allocation
Lucid plans to utilize the net proceeds from both the public offering and private placement for general corporate purposes, including capital expenditures and working capital. This influx of capital will provide the company with the necessary resources to drive growth and expansion.
Market Impact
This news comes on the heels of Lucid’s recent stock offering and preliminary results, which sent its shares plummeting. However, with this dual-pronged approach, the company is poised to regain momentum and strengthen its position in the market.
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